Iran war curbs Hormuz traffic, leaving Shell Pearl GTL half offline for at least a year and driving motor oil costs higher

The war in Iran has constrained traffic through the Strait of Hormuz and damaged Qatar’s Shell Pearl GTL plant, the world’s largest Group III base oil facility, leaving half of its capacity offline for at least a year. More than 45% of U.S. Group III base oil imports come from the Middle East, and the material is a key input for synthetic motor oil. Base oil prices are up more than 200% from pre-war levels as inventories run down, and some auto repair shops have already seen retail motor-oil prices rise about 60%. The disruption amounts to a meaningful near- to medium-term supply shock for crude-linked products, including motor fuels and other energy derivatives.